(Yicai) April 10 -- Retail sales of passenger vehicles in China surged over 14 percent last month from a year ago, marking the strongest year-on-year growth for March in almost a decade, fueled by government incentives encouraging vehicle trade-ins and upgrades.

Some 1.94 million passenger cars were sold in March, a 40 percent jump from the previous month, according to data released by the China Passenger Car Association yesterday.

The adoption rate of new energy vehicles continued to rise, exceeding 50 percent. Retail sales of NEVs exceeded 990,000 units, up 38 percent from a year earlier and 45 percent on February.

The year-on-year increase was the highest for March in nearly 10 years, with the retail volume being only slightly lower than the record 1.98 million units set in March 2018, said Cui Dongshu, secretary-general of the CPCA.

With the boost from the country’s trade-in and scrappage policies, the price war in China’s auto market has abated a little, leading to an overall improvement in the industry, Cui noted.

“The price war is somewhat subdued this year, but a trend among automakers of offering hidden discounts and benefits to buyers is emerging,” Cui pointed out. “Prices of 23 car models were lowered in March, down from 51 a year earlier, but remaining relatively high in historical terms.”

In the first quarter of the year, retail sales of passenger cars rose 6 percent to nearly 5.13 million from a year earlier, CPCA data also showed. NEV retail sales surged over 36 percent to 2.42 million, accounting for 47 percent of the total.

NEV sales will exceed 15 million this year, with pure electric cars likely accounting for about half of the total and plug-in hybrids and extended-range EVs making up 40 percent and 10 percent, respectively, Ouyang Minggao, an academician at the Chinese Academy of Sciences and vice chairman of China EV 100, told Yicai.

Editor: Futura Costaglione